Fossil fuel majors strut their stuff for Marrakesh

The big oil and gas conglomerates, the fossil fuel majors, say they want to cut their contribution to global warming. How serious are they?

An oil drill in California. Shell, BP and other fossil fuel majors pooled an investment fund aimed to reduce the impact of oil and gas on global warming, but a question mark over the sincerity of this initiative hovers. Image: Ben Klocek, CC BY-NC-ND 2.0

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No company has more to lose than Exxon. Though widely seen as the best-run oil company in the business, it’s also been the slowest among its peers to face up to the risks that climate change poses to its business.

Bloomberg reporter

Key actors?

These are players who believe that tough new measures to slow CO2 output may be unworkable unless they play a part in the debate.

Some of these companies have already moved back themselves a bit into renewables, but they are mainly pushing CCS-type solutions, plus promoting gas as a “transition” fuel.

Are they serious, or is it just greenwash to try to slow down the whole move to a lower carbon economy and buy time for their legacy oil and gas businesses?

Whatever they are up to, there is another course of action being taken by US energy corporations who have steered clear of the OGCI. Their slogan could be not so much “keep it (carbon) in the ground” as “keep it (your head) in the sand”, according to one critic.

The world’s biggest independently stock-listed oil company, Exxon Mobil, is among the least open to dialogue on climate change.

Chief executive Rex Tillerson and his board in Houston are ferociously independent and are used to financial success.

Critics within

Exxon has no interest in the OGCI and is known to be particularly opposed to that organisation’s calls for a carbon price.

But Exxon is increasingly coming under fire from its own shareholders about an apparent lack of planning for climate change.

Meanwhile two years of low oil prices have left Exxon in a drastically weakened financial state, forced to borrow money to pay dividends.

Exxon was also forced to admit that it may need to write off almost a fifth of its oil and gas reserves because they cannot be developed at an oil price of $50 per barrel.

The company is under investigation by the Securities and Exchange Commission over whether it is sitting on “stranded assets” that are worth nothing like the value they have been ascribed.

A recent piece on the financial newswire Bloomberg noted the surprising blindness Exxon seems to have around global warming, even when its own survival could be at stake.

“No company has more to lose than Exxon. Though widely seen as the best-run oil company in the business, it’s also been the slowest among its peers to face up to the risks that climate change poses to its business,” Bloomberg said.

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